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The scale of errors and fraud in the furlough scheme

09 September 2020 #Employment


To date, under the Coronavirus Job Retention Scheme the Government has paid £35 billion to employers to cover furlough payments.

HMRC confirmed this week that it estimates that 5% to 10% of that amount has been paid incorrectly due to error or fraud. Given the scale of the scheme and the speed with which it had to be introduced, these vulnerabilities were probably inevitable.

As the chief executive of HMRC explained in his evidence to the parliamentary Public Accounts Committee, HMRC:

  • Is not intending to try to find employers who have made legitimate mistakes;
  • Expects employers to check their claims and repay any excess amount; and
  • Will be focusing on abuse and fraud.

HMRC is currently investigating 27,000 high risk cases where they believe a serious error has been made. This follows 8,000 calls to HMRC’s fraud telephone hotline.

As discussed in our previous article from the start of the scheme, employers should on no account make fraudulent claims, which HMRC have already started to prosecute.

It is also important for employees and employers to understand that dismissing employees or subjecting them to any detriment because they have made an allegation of fraud would be in breach of whistleblower protections, for which compensation in the employment tribunal is unlimited.

Please contact our employment team for advice on these matters.

 

 

Clarkslegal, specialist Employment lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Employment matter please contact Clarkslegal's employment team by email at employmentunit@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

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Russell  Dann

Russell Dann
Associate

E: rdann@clarkslegal.com
T: 0118 960 4653
M: 0792 014 4165

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